A Free Trade Agreement between Australia and Korea would boost business confidence and open new market opportunities in the next decade, says Peter Anderson, chief executive of the Australian Chamber of Commerce and Industry.
Mr Anderson described the negotiations as a breakthrough in a dynamic North Asian country of more than 50 million people.
“It also holds the promise of more investment into Australia, and the creation of new wealth to sustain Australian living standards,” he said.
Mr Anderson said such an agreement is a demonstration to the private sector that Australia is 'open for business.'
“It will put Australian exporters on a more equal footing with US and EU competitors which have obtained improved access to the Korean market through their own Free Trade Agreements – an important goal since negotiations started in 2009.”
ACCI's Director of Trade and International Affairs, Bryan Clark, said: "The announcement will provide a substantial boost to the two way trade and investment opportunity between Australia and Korea.
“The deal is comprehensive in its coverage with very few exclusions and a substantial benefit to Australia’s important sectors, particularly manufacturing, agriculture, food and service sectors like professional services.
“We particularly welcome and support the government's flexibility in investor state dispute settlement and a pragmatic approach to foreign investment review board thresholds.
"ACCI looks forward to the finalisation of legal arrangements and the passage of the treaty through the parliament to ensure the earliest possible entry into force."
The Australian Industry Group also welcomed the announcement.
AiGroup chief executive Innes Willox said the negotiation of the Korea Australian Free Trade Agreement (KAFTA) is “a new step in building the network of Australia’s bilateral and regional trade agreements.”
“South Korea is our fourth largest trading partner and, critically, Australia’s signing of an FTA means that we now join the United States, the European Union and ASEAN countries who have been enjoying the benefits of preferential trade access through their own FTAs with Korea.”
Mr Willox said the KAFTA would have particular benefits for Australia’s agricultural and resource producers where often quite substantial tariffs have impeded the full potential of trade links.
“The agreement also appears to make important headway in improving access for Australia’s service exporters, he said.
“However, the news is more ambiguous for manufacturers with winners and losers likely to emerge. Its overall impact on key parts of industry will only become apparent over time.”